If you’re new to property investment you might be wondering what property investment companies are and how they work. You might even be questioning if you need to use one or not.
Fear not, we’ve got everything you need to educate yourself on property investment companies right here.
To put it simply, they’re specific companies that help you to invest in property if you don’t have the time or the knowledge to begin with. Essentially, they’re the middleman between you and the property that you’re going to be investing in.
They can be quite valuable to investors, particularly if you’re time-poor. They’ll source suitable properties for you, help you with the purchase process and can sometimes even manage the property for you.
There are a few. The biggie is usually their negotiation power! Property investment companies work with hundreds, if not thousands of investors all looking to find a deal – this makes negotiations far easier than if you were to attempt to negotiate alone for a single plot.
Secondly, they do the leg-work for you. Not all of it, but they’ll certainly save you time in the early stages. You can’t relinquish all of your due diligence duties onto them, but they’ll put in the groundwork for you.
If you’re new to property investment then you have a lot to learn. Working with a property investment company can help you avoid making expensive mistakes, spot opportunities before others and take advantage of bulk negotiation power.
Of course, you can find property investment opportunities by yourself, we’ve told you how you can do that here, but if you don’t have the time and want to speed up the building of your property portfolio, property investment companies are worth considering.
As with most things, there can also be disadvantages. Although not complete deal breakers, you do need to be aware that there will be a cost involved for these services and you might be limited to the choice of investments on offer.
You’ll have to trust their process and the way that they do things, it may be slightly different to how you would do it, but remember they’re saving you the time of doing it yourself.
And one last thing to consider, you’ll miss out on the full experience of seeing it through from beginning to end. So if you love the thrill of negotiating a deal, this might be a change for you. But once you get the keys you’ll have your investment and can move onto the next one.
Make sure you do your thorough research into property investment companies before deciding to do business with them. Look into their reputation, make sure they ask what you’re trying to achieve and whether or not they put you under pressure to buy.
Any decent property investment company would normally start off by having a courtesy call with you. This is usually to find out a bit more about you, what you’re wanting to achieve from investing in property and your current situation.
You’ll know if they’re a reputable company from doing your research, but also if they’re honest with you in that they will or won’t be a good fit for you – rather than just adding you to their mailing list and sending you deals that they know you’re not going to be interested in.
Most property investment companies will work closely with developers to source both new and existing developments. This allows them to negotiate the price of the units compared to what’s on the open market. Therefore, getting you, the investor, a discount on the purchase price.
Some companies will specialise in off-plan property whilst others will take anything and everything that is offered to them. Which isn’t always best practice or has the investors’ best interests in mind.
There’s no yes or no answer. It’s completely up to you, but it’s definitely something that you should do thorough research into before jumping into it.
If you don’t have the time to spend hours trawling through Rightmove every night after work, or attending auctions of a weekend in the hope to grab a bargain, then it’s something worth considering. Let the properties come to you, that you know meet your criteria.
And if you’re new to property investment, we’ve got the tools to get you started. Here’s an article on our top 24 tips to make you a better property investor. And, if you’re open to considering different locations, take a look at our 2020 hotspots and see if any of these areas tick your boxes.
If you’re looking to work with a property investment company and would like more advice, feel free to give our Invest team a call on 020 3322 9493 or send us an email to firstname.lastname@example.org.